Americans are working later into their lives than ever before. It’s not uncommon for people to work well into their 60s and beyond, as research from the U.S. Bureau of Labor Statistics shows. As a result, it’s very possible that a number of your employees are eligible for Medicare or will be soon. In this case, it benefits both you and your employees to set up a group health Medicare program.
What Are Group Health Medicare Plans?
While Medicare covers the majority of health care costs for seniors, it doesn’t pay for everything. Americans on Medicare are responsible for a number of sizable copayments and deductibles when they use health care. To help manage these costs, Medicare enrollees can sign up for private insurance plans. These plans charge a monthly premium and in exchange cover the large Medicare deductibles and copayments when needed.
A group Medicare program sells these plans as a workplace benefit to your employees who are on Medicare. After you set up a plan, such employees can decide whether they want to sign up for this extra coverage. A key benefit of these plans is that your employees could qualify for a lower group rate than if they tried to buy coverage on their own. Your company can also help cover some of the premium costs.
Which Employees Are Eligible?
Group health Medicare plans can only be sold to employees who are on Medicare. This means they need to be at least 65 years old. Your employees also need to have enrolled in Medicare Parts A and B. Finally, your employees have to decide they want to leave your regular health insurance plan to enroll on the Medicare plan. As long as you have 20 or more employees, employees have the right to stay on your regular health insurance plan even if they’re eligible for Medicare.
Should You Launch a Group Health Medicare Plan?
It really depends on what you and your employees want to do. A group Medicare plan is one more benefit your employees will appreciate. It might also work out to be a better deal for everyone: Your regular health insurance company might give you a lower rate if your older employees move to Medicare, and you can pass those savings on to employees by helping pay their Medicare group plan premiums.
On the other hand, a group health Medicare plan is one more benefit to set up and manage. This might not be worth the effort, especially if you don’t have many employees who will use the program. Your employees also need to be careful if they have dependents using your health insurance program. If an employee leaves your plan to sign up for Medicare, their dependents won’t be able to stay on your program.
As workers continue to get older, employers are going to need to adapt their benefits programs. A group health Medicare plan could be the way to keep your benefits program competitive.
This content is provided solely for informational purposes. It is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.
David Rodeck is a professional freelance writer based out of Delaware. Before writing full-time, he worked as a health- and life-insurance agent. He specializes in making insurance, investing and financial planning understandable.